Oregon Counseling Service, COA-Accredited Mental Health Practice

$1.3M

Revenue

$500K

SDE

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Full Editorial Writeup

This is an Oregon-based outpatient mental health counseling practice founded in 2016, running roughly $1.3M in annual revenue with $500K in EBITDA. That is a 38% margin, which is strong for a services business and tells you this is a lean, well-run clinic with 6 full-time employees working out of a single leased office. The practice holds COA (Council on Accreditation) status and scored 98% on its most recent audit, which is a meaningful signal of clinical and operational quality that also tends to protect payer relationships and reimbursement.

Mental health demand has been structurally rising for a decade and only accelerated post-2020, with payers expanding behavioral health coverage and chronic shortages of licensed clinicians in most markets. A practice with recurring patient panels, insurance billing relationships, and accreditation already in place is positioned to capture that demand rather than build it from scratch. The listing explicitly flags expansion into surrounding counties, which suggests the operating model is replicable and demand is not yet saturated.

The seller is retiring and offers seller financing plus a willingness to stay on as needed, which de-risks the transition for a buyer who is not a licensed clinician. At these economics this looks like a durable, essential-service cash flow business rather than a founder-dependent lifestyle practice, though the heavy reliance on licensed staff and payer mix will drive the real diligence.

Why we like it

At $1.3M revenue and $500K EBITDA, this practice runs a roughly 38% margin, which is excellent for a 6-person services business and indicates disciplined staffing and billing. Behavioral health services bill predictably against insurance and Medicaid, so earnings here are grounded in real, repeatable clinical volume rather than one-off projects.
COA accreditation with a 98% audit score is a genuine moat because it is time-consuming and expensive to obtain, protects payer contracts, and screens out casual competitors. New entrants cannot simply hang a shingle and match this, which gives the incumbent pricing power and referral stickiness in its market.
Mental health demand has been structurally rising for years, with payers broadening coverage and a chronic national shortage of licensed clinicians. This is counter-cyclical demand: utilization of behavioral health tends to hold or grow in downturns, not shrink.
Patients in counseling return week after week under ongoing treatment plans, so revenue behaves like a recurring panel rather than a series of new sales. Combined with the explicit opportunity to expand into surrounding counties, an operator can compound this base without reinventing the demand engine.

How to improve it

Audit the payer mix and renegotiate reimbursement rates with the top commercial payers in the first 90 days. Behavioral health rates vary widely and practices that bill passively often leave meaningful margin on the table versus current market contract rates.
Add telehealth capacity if it is not already maxed out, since it lets existing clinicians serve surrounding counties without opening new leases. This directly executes the stated county-expansion thesis at near-zero incremental fixed cost.
Build a clinician recruiting and retention pipeline immediately, because this business is capacity-constrained by licensed staff. Even one added full-time therapist at this margin profile can add six figures of EBITDA, so recruiting is the growth lever.
Tighten revenue cycle management: measure days in AR, denial rates, and no-show rates. Small improvements in collections and no-show policies flow almost entirely to the bottom line in a practice this size.
Formalize referral relationships with local primary care physicians, schools, courts, and hospitals to create a predictable intake funnel. Diversified, documented referral sources also reduce key-person risk and make the practice more bankable at exit.
Document clinical and operational SOPs tied to the COA standards so the 98% audit performance survives the ownership transition. This protects accreditation, which protects payer contracts, which protects the entire valuation.

Diligence notes

Confirm whether EBITDA of $500K is before or after a market-rate owner/clinical director salary, and whether the owner personally carries a patient caseload that generates revenue. If the retiring owner is also a billing clinician, replacing that production could materially reduce true earnings.
Scrutinize the payer and Medicaid mix along with reimbursement trends, since behavioral health rates and Medicaid policy in Oregon can shift and concentrate risk. Pull an aged AR report and denial history to validate collectibility of stated revenue.
Verify COA accreditation status, expiration date, and renewal requirements, plus any open corrective actions from the 98% audit. Accreditation lapses can jeopardize payer contracts and are the single biggest value-at-risk item here.
Review clinician credentials, licensure, non-competes, and tenure for all 6 full-time staff, because the asset is effectively the licensed team. Confirm whether key therapists are likely to stay post-close and under what compensation structure.
Clarify the leased office terms, remaining length, renewal options, and whether the lease is assignable, since a single leased location concentrates operational risk. Also confirm what the $29K FF&E actually covers relative to replacement needs.
Ask for the asking price and seller financing terms, both undisclosed here, and benchmark against the implied multiple on $500K EBITDA. Clarify the retiring seller's stay-on period in writing, since 'as needed' is too vague to rely on for a non-clinician buyer.

Source

Originally listed on BizBuySell. View original listing →